Malibu Media is a notorious porno-copyright-troll, a company whose business-model is sending blackmail letters to Internet users threatening to sue them for downloading pornographic movies (and forever link their names to pornography) unless they pay up. They invented a particularly loathsome tactic that sets them apart from other pornotrolls: their blackmail letters make a point of mentioning extremely explicit pornographic titles associated with films that they have no interest in -- basically, a sideways way of implying that any legal action eventually taken against you will include a bunch of humiliating and embarrassing movie-titles, when nothing of the sort is possible, since they don't represent those rightsholders and can't take legal action on their behalf.

Mike Masnick points out that other copyright trolls like Prenda and Righthaven have flamed out after the courts caught on to their shady tactics and started issuing sanctions and ruling for defendants. We can only hope that this will be Malibu's (near) future.

Malibu Media's denials do not pass the smell test, and any denial of improper motive by its counsel does not pass the laugh test. For the reasons described above, there exists no good basis upon which a reasonable attorney -- subject to the ethical rules and restrictions of Rule 11 -- could conclude that attachment of Exhibit C to a complaint "for evidentiary purposes only" served any legitimate purpose at that stage of litigation.

Later, the judge acknowledges that copyright trolling cases "already give off an air of extortion" and uses that to claim that making that situation even worse with things like Exhibit C makes the whole effort sanctionable. Unfortunately, the judge then limits the sanctions to just $200 per case (there are 11 related cases) for a total of $2,200, and then actually lets the cases move forward (they had been stayed while this issue was resolved). It's at least something, and shows yet another dirty trick from a copyright troll, and how Rule 11 sanctions can be used against such activities -- but it's hardly a game changer. Since it seems likely that they've used Exhibit C elsewhere, however, it seems likely this will come up again.